BIS paper finds banks could slow stablecoin growth by raising rates

Banks have a weapon against stablecoins, and it isn’t a lobbying budget. It’s the interest rate on your savings account. A new working paper from the Bank for International Settlements (BIS) finds that when banks pay savers more, stablecoin growth slows. The study suggests the two products compete for the same pool of money. What the BIS researchers found The paper is titled “Are stablecoins and bank deposits substitutes?” It was published as BIS Working Paper 1382 on October 13, 2026, and written by Rashad Ahmed and Iñaki Aldasoro. Their answer to the title question is a qualified yes. The authors conclude that reserve-backed stablecoins act as partial substitutes for traditional bank deposits. To get there, they worked through weekly US data running from January 2019 through June 2025. That window covers a dramatic stretch for the sector: stablecoin market capitalization climbed from less than $5 billion to more than $220 billion. Over that period, the average 10-week growth in stablecoin market cap came in at approximately 15%. That figure is the baseline the rest of the findings should be read against. The headline result: a 1 basis point increase in bank deposit rates lines up...